In March, the share of equity sales, or non-distressed property sales, rose to their highest level of total sales since February 2008, recording a 72.1 percent share, according to a CAR statement. Equity sales made up 66.8 percent of all sales in February and 51.2 percent of all sales in March 2012.

The combined share of all distressed property sales declined in March, dropping from 33.2 percent in February to 27.9 percent. Distressed properties comprised 48.8 percent of all sales in March 2012.

Among distressed properties, the share of short sales was 17.3 percent in March, down from 19.8 percent in February and from 22.6 percent in March of 2012. The March figure was the lowest since November 2009.

"Recent gains in home prices are increasing the market value of many underwater homes," said CAR President Don Faught.

"As a result, many homes that were previously listed as short sales are now selling as equity sales, as is indicated by the 5 percent drop in the share of short sales compared with last year."

California pending home sales, meanwhile, climbed from the previous month. Pending home sales are forward-looking indicators of future home sales activity, providing information on the market's future direction, according to CAR.

CAR's Pending Home Sales Index rose 14.8 percent from a revised 110.1 in February to 126.3 in March, based on signed contracts, according to the CAR statement. But pending sales were down 7.5 percent from the 136.5 index recorded in March 2012.

CAR also reported today that the share of sales by banks declined to their lowest level since late 2007, falling from 12.9 percent in February to 10.2 percent in March and down from 25.9 percent in March 2012.